The head of the government's financial system inquiry, David Murray, has warned that superannuation trustees may not be canvassing advice broadly enough, as he questioned whether there is scope to direct superannuation investment to infrastructure.
''We have to think carefully whether you can direct investments in the superannuation industry, or just allow the trustees and the beneficiaries acting together to determine where they'd like to invest,'' he said.
''Because if everybody uses the same model, that says, 'Given these circumstances you should only invest in these assets', then the trustees won't see the alternatives, and they might have to override that.
''Then they have to be careful in overriding it, if they understand the consequences of that on returns to the superannuants. So, that's why I think the best thing for trustees to do is to source consulting advice from a range of sources.''
In an interview in Hong Kong with Financial Review Sunday on Channel Nine, Mr Murray said that from discussions he has had with Asian investors and policymakers, it was clear it was time to start looking at whether the post-crisis regulatory framework was good for Australia and good for Asia in understanding how to support development of those systems.
''The problem for Asia is that the regulation driven out of Europe and the US, particularly Europe in response to the crisis, which resulted in the Basel III system, has been criticised … as representing problems for financing of small and medium enterprises, of trade finance and infrastructure.''
One of the criticisms of the Basel III framework in Asia has been claims that the capital, liquidity and leverage requirements designed to remedy some of the ills that led to the 2008-09 global financial crisis would be difficult to achieve. It is also claimed they would exert pressure on Chinese banks at a time of slowing growth, bad debts and concerns over its shadow banking system.
Mr Murray has previously said that regulation, including how it intersects with rules in Asian countries, would be a big focus of the inquiry. But he has gone a step further and suggested that global regulation might be what is needed to minimise harm on Asian economies and Australia.
''There's some unintended consequences we need to look at and in Asia it may well be wise to study that more closely and start arguing globally, we want global regulation, not regional.
''We may be smart to start questioning whether we should pause on some of that stuff and consider the consequences before we go too much further.''
He said the inquiry would also focus on the development of digital currencies such as Bitcoin, and whether the lack of regulatory oversight threatened the stability of the financial system.
''Confidence in the payments system is absolutely sacrosanct in a properly working economy,'' he said.